Commercial Real Estate Finds Its Role Limited in NYC Migrant Crisis

While much hinges on government decisions, industry leaders say expanded voucher programs and further zoning changes could house new arrivals faster

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New York City has been grappling with an influx of asylum seekers for the past 18 months, but city leaders are still approaching the crisis as if it were an emergency. It’s an emergency that the commercial real estate industry is largely sidelined for, awaiting direction from public officials.

Mayor Eric Adams has consistently warned that a continued surge of migrants will “destroy” New York City, forcing him to make painful budget cuts. He called for more federal aid to handle costs, demanded the Biden administration speed up work permits for thousands of new arrivals, and even visited Central America in October to dissuade migrants from traveling to America.

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More than 142,000 migrants have arrived in the five boroughs since last spring. But business and civic leaders are growing concerned that the city is not doing enough to create sufficient long-term housing accommodations, and move people into them to curb costs and create stable lives for unhoused families.

“I don’t envy the mayor, he could never have seen this coming. That said, it’s been going on for a year, and every day it’s seen as a brand-new problem,” said Christine Quinn, president and chief executive officer of Women In Need (WIN), a supportive housing provider. “Saying migrants are going to destroy the city and hope they go away isn’t going to get the job done.”

The city has provided round-the-clock services that cost $1.45 billion over the past fiscal year and could total $11 billion over the next two years, according to the city’s November budget report. That translates to roughly $394 per migrant per day in government funds.

In response to criticism from New York Gov. Kathy Hochul and Mayor Adams, the White House in September offered hundreds of thousands of Venezuelan immigrants temporary protections allowing them to work in the United States and expedited construction of the southern border wall.

Adams allocated funds in the city budget to handle migrants and was about to meet with the White House and the state’s congressional delegation to discuss boosting migrant aid on Nov. 2, before abruptly canceling his meetings when FBI agents raided his campaign fundraiser’s home. The mayor’s intensifying campaign finance scandal has in fact raised questions from rivals that City Hall is too distracted to deal with the migrant crisis. (Adams has not been accused of any wrongdoing.)  

Real estate leaders and advocates want to help, but there are limits to their capabilities. The White House and Congress must stem the flow of migration to give local officials a chance to make a dent.

“The migrant problem is created by federal laws and policies, and the problem with finding a creative solution is we’re not in charge of federal laws and policies,” said Kathy Wylde, president and CEO of the Partnership for NYC, which represents the city’s business leaders. “Without a federal solution it’s hopeless.”

There are a number of tools the city could use to move migrants into permanent homes so that they don’t overcrowd the city’s already strained shelter system.

A total of about 119,600 people were staying in the city’s homeless shelters in October, and more than half of them, 65,400, were migrants. The city has sought to expand its shelter system by having its Office of Emergency Management and public hospital system operate temporary respite and humanitarian emergency relief centers (HERCs) with services. At the same time, the Adams administration has limited migrants to 60-day stays in HERCs and fought to suspend a state law requiring the city to provide shelter to anyone who needs it.

Advocates warn that’s the wrong approach. Instead, the city should extend housing vouchers to migrants and work with property owners to make their unoccupied units available for rent as soon as possible.

“We need to focus on getting people out of shelter and supporting them into permanent housing. That is the more cost-effective and efficient way of dealing with this situation,” Murad Awawdeh, executive director of the New York Immigration Coalition, said. 

There are as many as 100,000 units eligible for housing vouchers, and another 25,000 rent-stabilized units could be activated for vouchers, advocates say. This fall, U.S. Rep. Dan Goldman announced the creation of 14,000 additional federal housing vouchers, coinciding with the $100 million in migrant aid the White House will send to the city.

But several obstacles to distributing vouchers and matching them with available units remain. 

Landlords have complained that the city’s lengthy apartment inspection process and a lack of caseworkers and inspectors have allowed vouchers to expire and apartments to go unused. 

The Real Estate Board of New York (REBNY) and the Community Housing Improvement Program (CHIP), both groups that represent landlords, have privately asked city agencies to fix its administrative delays, provide more troubleshooting assistance, and give caseworkers more autonomy to move inspections forward more quickly — all with little success. 

“The city is aware that REBNY and WIN think it’s an issue. Whether they’ll admit it themselves, I don’t know,” Quinn said. A REBNY spokesman added, “Federal leadership is critical to ensure that new migrants are able to legally work and to help the city and state afford the costs of supporting those in need.”

The state legislature may also need to amend a law In order for undocumented immigrants to be eligible for the voucher, although some advocates believe the change could be made administratively without new legislation.

The value of the housing voucher has also been a point of contention. Landlords with CHIP want to accept vouchers for a rent-stabilized unit, even if it’s more than the monthly rental price, and use the balance to renovate their buildings. 

Tenant advocates oppose the move, arguing that landlords should not be able to charge above the legal rent, which would drive up the cost of living. But CHIP Executive Director Jay Martin believes the units would remain unoccupied and said his members would be willing to keep voucher holders in those homes over the long term.

“The number one goal here is to get units back online, and, if it requires getting voucher holders in, so be it,” Martin said. “These tenants would go to a market unit that already exists and take the spot of someone else who has the ability to pay cash. The city and state are already going to pay that money. Why not have the benefit of approving housing?” 

If migrants keep arriving in New York at a similar pace in the future, the city will need to adopt creative solutions to house them. One idea is to create more single-room occupancy (SRO) or dormitory-style buildings that would allow tenants to rent single bedrooms while sharing bathrooms, kitchens and living rooms. Mayor Adams in September proposed a zoning change to allow more SRO-type residential buildings in areas with commercial zones, although the program has not been discussed as a housing option for migrants.

“This could be a powerful tool to add new housing for tens of thousands of residents across the city,” said Grace Rauh, executive director of the 5BORO Institute, which proposed the co-living pilot. “It’s a concept that could be adapted by the city to create longer-term housing for migrants and other New Yorkers in need.”

Connecting migrants to employment opportunities has been easier than finding long-term housing, but it has still been a challenge.

Once the White House extended temporary protected status to tens of thousands of Venezuelan immigrants, the New York Immigration Coalition and Immigrant Advocates Response Collaborative set up a pop-up clinic with the U.S. Citizenship and Immigration Services that provided legal services for 2,000 Venezuelans and helped 1,700 of them apply for work permits. 

The clinic lasted less than a month, but the efficient coordination of city, state and federal offices gave nonprofit advocates hope that more people could be screened quickly.

“The goal here was to try to get as many people as possible work authorizations and immigration relief applications so they can work in the formal economy where it’s less likely for them to be taken advantage of,” the coalition’s Awawdeh said. “We need to do more. This is a marathon.”

Once migrants receive their work permits, the city and state’s workforce centers have been collaborating with employers in the hospitality, construction and health care industries to fill job vacancies. Labor unions, which sought expedited permits, have also played a role, but it’s been harder to put migrants into higher-paying unionized jobs that require more training. Those without permits continue to pick up minimum-wage work in the underground economy, such as delivering food.

As winter approaches, migrant families need a mix of essential items as well as legal aid for urgent problems. Quinn suggested people donate coats, blankets, diapers and baby wipes to several groups organizing clothing drives. But the former City Council speaker also implored the city’s law firms to dedicate their general counsel’s office or offer attorneys to volunteer to participate in migrant-focused legal clinics.

“When you’re a new arrival and you hope to get asylum or temporary protected status or a visa, you have a year and legal representation is not as robust as we need to be,” Quinn said. “We need to help individuals do the paperwork they need to do, get work status, and get off to having a good life.”